Investment follows incentives (edu doesn't have them)

The National Journal guest hosts asked “what are the essential components of an effective innovation, research, development, and dissemination infrastructure in education?” The question begged for a bureaucratic answer and blog responses went all over the place, but I think most folks missed the boat on this one.

An inefficient market dampens R&D investment and innovation diffusion. While a couple large-scale well organized government efforts would reduce the random inapplicability that characterizes most education research today, the real solution lies in getting the incentives right. There’s no lack of investment and innovation in other sectors—this problem is peculiar to education and stems from the history of local control and limitations on private sector involvement.

Billions of dollars flowed into clean tech over the last three years with the expectation of changing consumer expectations and government incentives. The Department of Energy recently released $500 million in grants—all to private companies. Unlike Energy, Defense, Health, or Transportation, the Department of Education does not have (or has not exercised) the same authority.

This problem runs deeper than USED authority, it’s a fundamental governance problem. The combination of local control intertwined with antiquated labor contracts reduces performance and innovation incentives. We won’t fix the investment and innovation problem without creating performance-oriented employment and governance. When investors see some that that looks like a market with some innovation diffusion (driven by performance incentives/consequences), they’ll invest in high priority sector needs.